The location select list will, by design, display the location code (or key) field and sort the list by that key field. This is not configurable.
However, the data in the location code (key) field does not have to be the location UUID. If you prefer, populate the location code field with the location name, provided the location name data is unique across all the locations.
If CA Software Asset Manager is integrated with CA Asset Portfolio Management (APM), then the locations should maintained in APM and not in SAM.
You can change the SAMDataSyncConfig.xml file so that the APM location name field populates over to the SAM location code (key) field.
For example, use this mapping: <SamField apmattribute="locationname" samattribute="location_key"/>
Be certain that your location names will be unique before using this mapping, as this setting can cause duplicate location names.